Arrange the following statement considering the effects on total income and output when the government purchases (G) increase keeping taxes constant.

(A). Planned aggregate expenditure will increase.

(B). When G exceeds T, the government runs a deficit.

(C). Equilibrium income will increase.

(D). Aggregate demand schedule shifts rightward.

Choose the correct answer from the options given below:

Option 1 -> This sequence starts with planned aggregate expenditure increase, but doesn't follow the logical chain of causation from the initial fiscal condition.

Option 2 -> This sequence places equilibrium income increase before aggregate demand shift, which reverses the cause-effect relationship.

Option 3 -> This correctly sequences: (B) fiscal deficit condition → (A) planned expenditure increase → (D) AD curve shifts right → (C) equilibrium income rises. This follows the proper macroeconomic transmission mechanism.

Option 4 -> This sequence starts with equilibrium income increase, which is the final outcome, not the starting point.

Hence, Option 3: (B), (A), (D), (C) -> When government purchases increase with constant taxes: First, (B) establishes that G > T creates a deficit (initial fiscal condition). Then (A) planned aggregate expenditure increases since G is a component of AE. This causes (D) the aggregate demand schedule to shift rightward. Finally, (C) through the multiplier effect, equilibrium income increases. This sequence correctly captures the chain of macroeconomic effects from fiscal expansion. -> correct